Can the S&P Break Above its 2007 High?

After recording a 13% gain in 2012, the S&P 500 is barreling higher. Can it crack 1,500? What about its 2007 record high of 1,565?

Here's a quick snapshot of where the S&P 500 (NYSEARCA:VOO) is at right now:

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• S&P 500 is already ahead 4.65% this year, on par with its sizzling 2012 start of 4.59%;• 93.4% of S&P stocks are above their 50 day moving average;• All nine S&P industry sectors are in positive territory; • The S&P has gained for five consecutive days.

Current breadth readings are approaching Oct.28, 2011 highs when 94% of S&P stocks were trading above their 50 day moving average.

Another remarkable feat is the S&P's streak of 477 consecutive calendar days without a 10% correction. The current streak is on pace to break a 56-year record of 650 days which occurred from 10/22/57 to 8/02/59. The last period of a 10% correction occurred on 10/3/11.

Although large company stocks have moved higher, the broader market is really being led up by midcap (NYSEARCA:MDY) and small cap (NYSEARCA:IJR) stocks, which are outperforming large stocks between 1 to 1.5%. More evidence the "risk on" trade is still working is the CBOE VIX Volatility Index (^VIX) trading near 18-year lows. Based upon today's VIX, stock market fear is non-existent. Should investors remain bullish on U.S. stocks (NYSEARCA:SCHB) or is it time to get defensive?

The ETF Profit Strategy Newsletter wrote:

"The S&P continues its uptrend and got the gap open above 1475 driven by the futures on Thursday morning, 1/17. The gap open was expected as the daytime S&P couldn't break its resistance and needed the futures once again to drive price higher. The breakout buy trade from the 1/9 technical trade remains intact and profitable as stops can now be moved up again just under trendline support at 1,475. This should lock in at least 10 points of profit thus far with paper profits around 20 points."

Increasing stops in a rallying market is a prudent strategy that disciplined traders/investors do. Despite the S&P's impressive run, the stock market's next big move is still ahead. Will you be ready?

No bull market ever happens without a break above resistance and no bear market can occur without a break below support. What are the key levels we're watching? The ETF Profit Strategy Newsletter analyzes market sentiment, support/resistance levels, and other indicators to provide high probability trading setups.